According to the BBC Business News website, UK and US banking authorities have plans in place designed specificially to limit damage should banks suffer financial difficulties.
The intention is that one national regulator would assume responsibility for overseeing the insolvency of a big international bank. This is in contrast to national bodies dealing with the subsidiaries of the bank concerned in each country. Ideally, this move would prevent governments having to step in to support banks, while also enabling parts of the bank that are viable to continue trading.
If successful, the move would limit the cost to taxpayers in the next banking crisis.
Ideally of course, big banks should have sufficient funding at the top of their organization to enable them to absorb any resultant losses.
Robert Peston, Business Editor quoted on the BBCs Business News website expressed concern over the fact that ?If banks are no longer considered too big to fail, the costs for banks of raising money would rise,? adding that this means, ?they would feel obliged to charge their customers rather more for loans and for keeping money safe.?
The Bank of England, in the UK and the Federal Deposit Insurance Corporation in the US are seeking a common approach in order to compensate savers should a bank fail economically.
It is intended that only those banks which are globally active would be covered by the plans, with management held responsible for bank collapses and replaced accordingly.
Source: http://www.businessnetworkinglink.com/2012/12/banking-authorities-plans-for-damage-limitation/
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